Chrétien builds links with Chinese conglomerate

GEOFFREY YORK
The Globe and Mail (Canada)
February 6, 2004 at 6:51 AM EDT

Beijing -- Less than two months after stepping down as prime
minister, Jean Chretien is moving quickly to forge a relationship
with China's wealthiest and most powerful business conglomerate.

Making a surprisingly speedy entrance onto the global business stage,
Mr. Chretien will arrive in China this weekend with a team of Power
Corp. executives to meet some of China's most influential business leaders.

The visit, his first major overseas trip since his retirement, is
being kept hush-hush. Neither the Canadian embassy in Beijing nor his
law office in Ottawa is revealing any details of the visit, insisting
that it is completely "private."

But The Globe and Mail has learned that much of Mr. Chrétien's tour
of Beijing and other Chinese cities over the coming week is being
organized by state-owned China International Trust and Investment
Corp. CITIC is China's biggest and most powerful conglomerate, with a
vast range of interests on four continents.

These include financial services, energy, heavy industry, real
estate, hotels, airlines and even military exports.

Established in 1979 and accorded the status of a ministry, CITIC
began moving into global ventures in the mid-1980s. With assets of
about $48-billion (U.S.), it has close links to the commercial
interests of the People's Liberation Army and its leadership answers
directly to the State Council, China's supreme executive organ.

Mr. Chrétien is expected to hold meetings with CITIC's top
executives, who plan to visit Canada this year. Chinese sources say
he also has tentative plans to meet next week with top executives of
Unicom, one of China's two main cellphone companies.

He'll be accompanied by his son-in-law, André Desmarais, the
president of Power Corp., who is a director of CITIC Pacific Ltd.,
the Hong Kong affiliate of the CITIC group.

The subject of their meetings is unknown. But Power Corp. has
extensive business interests in China, including property development
in Shanghai's booming Pudong district and a joint venture with
Bombardier to manufacture railway cars in the coastal city of Qingdao.

Sources say Mr. Chrétien is expected to arrive in Beijing on Sunday,
attend a cocktail reception with the Canada China Business Council
that evening, spend two or three additional days in Beijing, then
travel on to Shanghai and the northeastern city of Shenyang, near the
border with North Korea.

By moving so quickly into the Chinese business world, Mr. Chrétien
will be able to capitalize on his extensive political dealings with
Chinese leaders over the past decade. As prime minister he visited
China six times, led two Team Canada trade and investment missions to
the country and met frequently with its top leaders.

Barely three months ago, he toured China for three days on his final
Asian trip as prime minister. And he deliberately chose to meet
Chinese Prime Minister Wen Jiabao on his final day in office on Dec. 12.

Since his retirement from politics, Mr. Chrétien has lined up a
series of business gigs. He is an international-relations adviser to
PetroKazakhstan, a Calgary-based oil company that is trying to expand
its oil exports to China and other Asian and Middle Eastern
countries. And he has joined three separate law firms: Montreal-based
Heenan Blaikie, Calgary-based Bennett Jones, and Montreal-based
Desjardins Ducharme Stein Monast.

His speedy return to China has provoked some raised eyebrows in the
Canadian business community in Beijing. "I think there should be a
cooling-off period," said one Canadian businessman in Beijing, who
spoke on condition of anonymity.

"There has to be a period of decorum if you're civilized. It's
interesting that he's back here so quickly. Considering that he was
here in October and hosted Wen on his last day in office, he should
have waited."

In Ottawa, the prime ministerial ethics counsellor said there are no
guidelines that prevent a former prime minister from taking such a
trip. Howard Wilson said there is a two-year "cooling-off" period,
but the restrictions apply to lobbying Ottawa or taking jobs with
firms with whom the former leader had "direct and significant"
official dealings in his final year in office.

Mr. Wilson was ethics counsellor to Mr. Chrétien during his 10 years in office.